Daily Market Analysis from ForexMart

[KostiaForexMart]

EUR/USD Daily Analysis: August 29, 2019

Since the North American session yesterday, the euro major pair has been trading sideways and may even have a bigger move with the upcoming significant data. 

Concerns on trade wars weren’t as prominent anymore after the recent comment of Trump that both nations are willing to work out the deal. Equity markets are faced with a strong bid in early trading today and countered the decline of the S&P 500 last week. Nonetheless, the euro major pair has had fewer fluctuations with the recent risk sentiment since the return of risk appetite. 

The support level at 1.1075 keeps the pair to go higher after several attempts of testing in this month. There may also be a slight bounce from here but in general, sellers are leading this week. Although, we cannot see any turn for now. 

Any attempt to rise was limited at the level of 1.1100. Alternately, in case of a decline, the pair is likely to recover.

Moreover, the dollar index (DXY) has also met some sort of resistance. The last figure tested is the level of 98.25 that kept the price lower in April and May. Consequently, the index pulled back by more than 1%. Hence, the dollar and the euro major pair have a likelihood for a slight decline but do far, we can see any technical movement to support this.

There has been volatility and the pair has been trading range-bound. Important fundamental, particularly the US GDP and German CPI, are anticipated and will determine the movement of the EUR/USD pair. 

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EUR/USD Daily Analysis: September 2, 2019

This week might start with slow trading given the US Labor day. Volatility will probably rise in the latter days of the week, especially with the upcoming US jobs data on Friday and Fed speech. 

Also, the progress on the Sino-US trade war will still have an effect on the exchange rate. Jus in the previous week, Trump said that the two nations will proceed with the trade talks, which induced a shift in the markets. In turn, this resulted in a decline in the euro major pair. 

The economic data in the eurozone has actually met expectations of analysts, except for the decrease in the manufacturing sector. Overall, reports from Italy, Germany, and the eurozone are declining in the market. Meanwhile, France showed growth in August but data will remain to be a concern for the euro economy. 

The decline of the EUR/USD pair on Friday is important as it pushes the rate to a record low over a year. Also, the pair dropped lower than 1.1000 that have an impact on the pair. It seems that the pair proceeds with a decline with the next important support level at 1.0833. 

It can be said that the trading rate is slightly oversold present levels. Sometimes, unexpected volatility drove the pair unexpectedly at the end of the month, which is the probable reason for the decline last week. 

If the price proceeds with the recovery, sellers will probably touch on the level of 1.1100. HIgher than that is where the resistance is found at 1.1030, which was previously support. 

In general, the euro major pair is moving sideways following a drastic drop on Friday. Moreover, volatility will likely be slow with the present US holiday but attempts for recovery will be blocked by sellers around 1.1000 then towards 1.1030. 

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EUR/USD Daily Analysis: September 3, 2019

Price movement in the EUR/USD pair is intriguing as it recovered instead of a breakdown, which is unexpected by traders and oftentimes occur much later and outside the range. 

We cannot be so sure that this would not be the case, although this is possible. One scenario is the oversold state of the EUR/USD pair for a while now. While trading in a range, this gives a signal for the possibility of a pullback. However, the pair is likely to move in the oversold zone for some time. 

With the euro declining against other bearish currencies, it will be not ideal to search for a pullback towards the medial levels, which was the case last year. The common currency also trades against the lows of the Swiss franc and Japanese yen. As for the case of the sterling pound, it is still pressured with the ongoing Brexit negotiation. 

I assume that it is highly likely for the attempts for recovery to be faced by the sellers instead of a pullback. We can wait for the resistance to reach at 1.0979 and then a bounce to 1.0911. Nonetheless, no purchases at the present descending motion signals for a technical breakdown but sustained break to 1.1050 opposes a breakout.

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EUR/USD Daily Analysis: September 4, 2019

Yesterday, the main level above is at 1.1050. A sustained downward trend from the seller would confirm the descend. 

The short-term momentum is leaning to the upside. Yesterday, The currency pair showed a bullish candle on the daily chart, which we should look into. In case the pair closes around 1.100 by the end of the day, this will signal further upward movement in the short-term. 

It seems that the recovery of the major British pound adds pressure to the US dollar that overshadows the EUR/USD pair. Although, we must also keep in mind that the volatility of Sterling can rise by the end of the week amid the political uncertainty with Brexit. 

Overall, the euro major pair shows a strong uptrend after yesterday’s low. For short-term, it is bullish but extending it a bit shows a bearish outlook. In the meantime, sellers could make use of the recovery. 

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EUR/USD Daily Analysis: September 5, 2019

Today, ADP data from the US will be published, which will give an initial outlook on the current state of the job market in August. Other than that, some PMI data will be released during the North American session that can also induce volatility. So far, analysts anticipate a continuous growth for the reports. Important talks will take place in early October. 

On Friday, data on Non-Farm Payroll is scheduled and this will have a bigger impact on the market. Of course, concerns on China-US trade war will still affect the price movement as well. 

The rally yesterday continued and formed a bullish candlestick pattern on the daily chart. Overall, the technical outlook shows a breakdown, which is contradicting to the bullish indicator. 

The direction of the pair in the major resistance level will be relative to the reaction of the market in the current price movement. Important psychological levels are 1.1033 and 1.1053, which shows important support to the pair in August that can become an obstacle for the price to rise. 

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EUR/USD Daily Analysis: September 6, 2019

So far, the euro is moving lower after publishing the U.S. Non-Farm Payrolls report, which would weigh on Fed’s decision regarding the interest rate in September. Furthermore, this would reflect the stability of the economy. 

The main trend is descending on the daily chart. However, the momentum shows its movement rising since the price reversal bottom formed at 1.0926 on September 3. 

A breakthrough to 1.1164 could shift the trend higher. However, if it moves towards 1.0926 instead, then this will oppose the closing price reversal boot and indicate the continuation of a downward trend. 

The main range between 1.1164 and 1.0926 with the retracement zone at  1.1045 to 1.1073 offering as a resistance. This limits the short-term movement of the EUR/USD pair. Buyers could test the short-term range at 1.0926-1.1085 in hopes to reach for a much higher bottom with the retracement zone at 1.1005 to 1.0987 as the probable support. 

Today’s price movement will depend on the reaction of traders at the price range of 1.1045-1.1046 and currently, the price is at 1.1029. 

If the price remains below the 1.1045, this would mean the presence of sellers and could push the short-term price by 50% at 1.1005 with the next support around 1.0987 to 1.0986. However, moving past the area of 1.0985 would cause the pair to descend around  1.0956 and 1.0941 before the main bottom of  1.0926. 

On the other hand, a price movement higher than 1.1046 would indicate the presence of buyers and could bring the price upward with the next target at 1.1073 to 1.1074 and then to 1.1085. It could further rise to 1.1119, which is a potential pint for upward movement.

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EUR/USD Daily Analysis: September 26, 2019

After a sharp increase of the Dollar on Wednesday trading, the price slides down and moving close to a significant support level. 

The horizontal support level is at 1.0930 kept the pair higher for two times this month and every test will result in a rally towards the area of 1.10. If the pair breaks down, it could reach a new 28-month low. 

News on Trump’s impeachment did not keep the dollar from rising as if the markets aren’t affected at all. Meanwhile, the latest US GDP data will be published today and the forecast expects a 2% growth in the second quarter. A speech from the ECB president Mario Draghi could induce some volatility when considering the monetary policy of the economy. 

The euro major pair will likely have a breakout to a new multi-year low but the question now is whether the decline will continue. So far, the pair trades range-bound most of the month and begin to be a bit oversold on short-term timeframes. 

For this year, most of the time the price has been fluctuating between declining and dropping into a range. Hence, I would be a bit cautious to see if this will be a full-blow breakdown. 

If the price rises in the next session, sellers will try to defend the level of 1.0966, which has been the lowest daily close in the first half of the month. 

The pair trades close to the level of 1.0930 during the North American trading session today should also be noted. If the pair stays higher, we can expect a slight bounce of the pair. 

On the contrary, the price will likely have stops accumulated below the level of 1.0930 as traders look for a double bottom potential. Therefore, the price can have dipped below and may induce stops. The resistance of 1.0966 keeps recovery rallies the upcoming trading session.

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EUR/USD Daily Analysis: September 27, 2019

The US dollar index that measures the value of the greenback against a basket of major currencies is now about to break a 28-month high. Meanwhile, the euro major pair has broken to an equivalent low that seems to lead to further losses. 

So far, only the New Zealand dollar has taken the lead against the greenback while the British pound has been the weakest for this week as it went down by 1.5% against the dollar. 

Data releases from Europe similar to inflation came in weaker than anticipated earlier today. The German import price dropped by 0.6% in August compared to the previous 0.3%. Also, the CPI in France has declined by 0.3% in the present month. As for Consumer spending, it was flat and did not meet the expectations of analysts. 

Economic data to be released later this day will include the US durable goods orders and personal spending figure. The data will typically not induce a volatile reaction in the trading rate. 

[KostiaForexMart]

EUR/USD Daily Analysis: September 30, 2019

The EUR/USD pair hasn’t fallen this low since May 2017 as the dollar takes the lead. The pair broke lower at the support level of 1.0930 that could induce a breakout, although,  the pair was able to return back above the level. However, the pair has moved back and forth that makes it uncertain whether that pair can have a full breakdown. 

A driver is needed for a stronger decline but given the economic calendar for the week, it will likely be a political one. The main focus of economic release for the week is the US jobs report that is to be released on Friday. 

The euro major pair rose higher than the major level of 1.0930, which kept the price from declining at the beginning and near the middle of the month. Its recovery raises the question on its resumption of decline but for now, the pair moves strongly downward. 

A breakout above the resistance may reason limit the descent of the pair. As of now, the resistance level is seen at 1.0966. The upward movement of the pair resides close to the level that forms a slight confluence. 

A breakdown to 1.0930 would attract more sellers. Hence, the initial support level is close to the area of 1.0900, which buyers defended late last week. With the upcoming US jobs report, the volatility will increase in the late week. On the headlines, news on the impeachment of Trump continues.

[KostiaForexMart]

EUR/USD Daily Analysis: November 05, 2019

The dollar received significant support after the release of Friday data from the US. Labor market statistics exceeded all expectations of market players, which eased concerns about the upcoming recession in the United States. In October, the number of new jobs increased to 128 thousand, while experts predicted growth to just 85 thousand. The ISM business activity index also recovered slightly (48.3 points in October against 47.8 in September).

This week is not rich in macroeconomic data, but today the ISM Service Sector Index can attract attention (at 18:00 Moscow time). If the indicators are at quite stable levels, this may support the dollar in the coming days.

Thus, the EUR/USD pair fell on Tuesday to the level of 1.1125. The dollar feels confident, therefore, during the day, the strengthening of the US currency will continue. The main goal of the dollar “bulls” is the 1.1100 area.

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EUR/USD. November 06, 2019 – Dollar will continue growing to the area of 1.1050

Positive news from the front of trade talks between the US and China is supporting the whole range of risky assets. As a result the EUR/USD pair suspended its decline in the area of 1.1050 and began to grow to 1.1100. However, the correction of the euro will not be long as the US currency continues to remain strong. During the day, we expect the return of euro quotes to the area of 1.1050.

The day before the US dollar got significant support from the publication of US data: the ISM index in the non-manufacturing sector grew up to 54.7 points against expectations the indicator at the level of 53.5 points. Moreover, the dollar receives additional support from the comments of the Fed representatives, signaling the likely completion of a cycle of rate cuts in the United States.
 

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EUR/USD. November 07, 2019 – The positive news on trade talks support the euro

The full range of risky assets received support against the rise of the the news that the US and China agreed on the mutual abolition of duties on part of imported goods. This was stated today by representatives of Chinese Ministry of Commerce, which also noted that further actions of USA and PRC will depend on success in concluding a comprehensive trade deal. As a result, the pair managed to recover from the level of 1.1050 to the level of 1.1090.

However, market players doubt that global trade disagreements between the two largest economies in the world can be resolved at once by signing a nominal deal. Therefore, the risks of further problems in relations between the two countries are still high, and optimism about the success of trade debates may turn out to be short-lived.

Thus, during the day the EUR/USD pair will moderately grow to the level of 1.11.

[KostiaForexMart]

GBP/USD. November 08, 2019 – Pound consolidates near 1.28

The British sterling fell to a two-week low at 1.2800. Yesterday the Bank of England kept the key rate unchanged at 0.75%, although two out of nine members of the Committee voted for an immediate reduction in the rate by 25 bp. This results  surprised markets, as it was the first split of opinions for the last year. At the same time, the Central Bank lowered its GDP forecast for 2020 and 2021 and the short-term forecast for inflation. According to these forecasts, the regulator suggests only one reduction in interest rates over the next 3 years.

Representatives of the British regulator are concerned about the weak labor market in the country, the slowdown in the global economy, as well as further uncertainty concerning the Brexit issue. Thus, the pair pound/dollar shows a decline below the area of 1.28 and keeps here in a stable flat. During the day, we expect further weakening of the British currency.

[KostiaForexMart]

USD/CAD. November 11, 2019 – Canadian dollar weakens after labor market data

The USD/CAD pair managed to gain a foothold above 1.3200 after the release of weak data on the labor market in Canada, which turned out to be much worse than analysts' forecasts. Experts expected that employment growth would slow from 53 thousand to 15, but current data showed an unexpected decrease in the number of jobs by 1.8 thousand.

Despite the fact that the growth in average wages accelerated, Friday's data reflected the weakness of the Canadian labor market and increased the likelihood of an interest rate reduction by the Bank of Canada by the end of this year.

Against this background, the USD/CAD pair rose to the level of 1.3225 and continue to consolidate in this area at the beginning of the week. Today we expect further moderate growth of the US dollar to 1.3250.

[KostiaForexMart]

GBP/USD. November 12, 2019 – Pound moderately grows despite weak macroeconomic data

The British sterling today shows growth to the level of 1,2800, despite weaker than expected data on GDP, trade and industrial production in the UK. British GDP grew by only 0.3% in the III quarter (the forecast – growth by 0.4%), the trade balance was at -12.541 billion pounds, and industrial production – -0.3% (the forecast of -0 , 2%). 

The British currency was supported by Nigel Farage's comments, that his Brexit party would not oppose the Conservative candidates. This is great news for Boris Johnson, whose chances of winning the December elections have grown significantly after this statement.

However, this positive can be offset by weak macroeconomic data. Today's report on the labor market reflected an increase in the number of applications for unemployment benefits to 33 thousand. The previous indicator was fixed at around 13.5 thousand.

Thus, today under the influence of multidirectional factors, the sterling will continue to grow moderately to the level of 1.28. However, fixing below this mark is unlikely.

[KostiaForexMart]

EUR/USD. November 13, 2019 – Euro plummeted to 1.10

The euro continues to decline to the mark of 1.1000 against the backdrop of a deterioration in appetite for risky assets. Pressure on risk was exerted by yesterday's speech of US President D. Trump at the Economic Club of New York. The US leader gave a very contradictory evaluation of the current state of trade negotiations. Trump noted that USA and China nowadays are close to concluding an intermediate phase of a trade deal, however, at the same time, the US intend to further increase import duties from China.

An additional reason for the European currency weakness became the information on possible tariffs by the United States for automotive products in the EU.

Today, attention should be paid to the speech of Fed Chairman J. Powell in Congress. It is expected that his rhetoric will remain as optimistic as it have been after the October meeting of the regulator, which will allow the dollar to maintain a strong position. During the day the pair EUR/USD will fluctuate near the mark of 1.10.

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GBP/USD. November 19, 2019 – Pound is likely to weaken

At the beginning of the week, the British sterling showed growth to the level of 1.3000, but the bulls failed to overcome it. Today, the GBP/USD pair has fallen to around 1.2925. 

This week is not rich in the publication of macroeconomic data, so the major impact on the dynamics of the British currency will have the first head-to-head debates between Boris Johnson and Jeremy Corbyn on ITV. It’s known, that Johnson’s party is far ahead of the Labor Party. The market also likes his words about tax breaks and increased spending, that supports the pound.

However, experts believe that the positive effect of the last deferral of Brexit is almost completely taken into account in quotations. Therefore, with the arrival of new weak macroeconomic data on the British economy, the pound may cease to recover.

[KostiaForexMart]

EUR/USD. November 20, 2019 – Euro weakly declining amid pessimism over trade negotiations

The euro continues to decline moderately after a steady rise the days before. The current quotation of the pair EUR/USD is 1.1053. The euro is under the influence of conflicting news coming from the front of trade negotiations between the United States and China. On the one hand, the US authorities extended the license for the Chinese company Huawei for another 90 days. On the other hand, the Chinese side still doubts the possibility of concluding a final agreement. This information made many traders go into defensive assets.

Moreover, China has protested against the United States approval of the Hong Kong Bill («On the Protection of Human Rights and Democracy in Hong Kong»), considering it to be interference in China and a violation of international laws. Such actions could again cool the relations between the two countries, which, for its part, negatively affect further trade talks and put strong pressure on risky assets. As a result, the euro may resume decline to the area of 1.1030.

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USD/CAD. November 21, 2019 – Canadian dollar weakened to 5-week lows

The Canadian dollar fell to a 5-week low at mark 1.3330, despite rising inflationary pressure in Canada and the strengthening of Brent position in the oil market to $62.70 per barrel. The current quotation of the USD/CAD pair is 1.3300. Pessimism over US-China trade relations is forcing investors to give up risky assets and raises demand for safe assets and the dollar. Moreover it is putting pressure on commodity goods prices and commodity currencies, such as CAD.

According to current data, consumer prices in October rose 0.3% after falling 0.4% in September. Inflation remained at 1.9% year on year. Today, attention should be paid to the speech by the Governor of the Bank of Canada Stephen Poloz, who may touch on the theme of deterioration of the global economy, which increases the risks of lower interest rates in Canada.

The decision on monetary policy will be made by the Bank of Canada at the next meeting of the regulator, scheduled for December 4. Up to this point, the Canadian dollar may be under pressure in the area of 1.3300. Tomorrow you should pay attention to the release of data on retail sales.
 

[KostiaForexMart]

22.11. European markets lost growth after weak PMI

On Friday, European stock markets slowed earlier growth. It was caused by the publication of the weak preliminary business activity index (PMI) in the Eurozone, which didn’t show the visible improvement in the economy of the region, still weighed down by the trade conflict between the US and China.

According to IHS Markit, in October, the composite business activity index in the European Union fell from 50.6 to 50.3, fell short of the expectations for an improvement to 50.9. Data from France and Germany showed that manufacturing PMIs were stronger than expected, but service sector activity slowed sharply.

Christina Lagarde, the new president of the European Central Bank noted, that she was not intended to sharply change the monetary policies of her predecessor, Mario Draghi. And judging by the shares, banks are confident that in the near future easing of monetary policy will not happen.

[KostiaForexMart]

EUR/USD. November 25, 2019 – The euro has weakened to the level of 1.10

Last Friday the US dollar got strong support amid published macroeconomic data. This allowed the quotes of the EUR/USD pair to reach closely to the level of 1.1000. According to the data, the index of business activity in industry and in the service sector grew from 51.3 and 50.6 points to 52.2 and 51.6 points, respectively. At the same time, statistics from the EU put pressure on the euro: the PMI composite business activity index in the region fell moderately and remained close to 50.

Additional pressure on the euro was provided by gold sales amid growing interest in risky assets. The reason for improving risk appetite was the information that China plans to increase fines for violations of intellectual property rights, trying to eliminate one of the key topics of the trade conflict between the United States and China. Moreover, the bill in support of protesters in Hong Kong was never signed by US President D. Trump, which significantly reduced the degree of tension between the countries.

So, in the prevailing conditions, the pair will move in a narrow range near the level of 1.10.

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EUR/USD. November 26, 2019 – Euro in a narrow range just above 1.10

Sentiment on global markets remains positive amid further optimistic statements on trade negotiations. It became known that the United States and China continue to take active measures to sign the first part of the deal as soon as possible. In particular, the parties held telephone talks: Deputy Prime Minister He, the US Minister of Finance S. Mnuchin and the sales representative R. Lighthizer reached an agreement on many issues, including the cancellation of part of the tariffs.

Moreover, D. Trump did not sign the bill on the situation in Hong Kong, earlier being approved by both houses of Congress, that confirms the US’s reluctance to escalate the conflict with China.

As a result, the EUR/USD pair strengthened slightly to 1.1015 mark. Nevertheless, the euro is still under pressure – the Ifo data on the business climate in Germany released yesterday confirmed that a quick recovery in the German economy is currently unlikely. During the day, the pair will fluctuate slightly above 1.10.
 

[KostiaForexMart]

EUR/USD. November 27, 2019 – Euro continues to weaken

In the absence of significant macroeconomic data, the EUR/USD pair continues to decline slightly to the level of 1.10. The focus of the markets is still the news on the course of trade talks between the US and China. The day before, US President D. Trump reiterated that the sides are very close to signing the first phase of a comprehensive agreement, which had supported the full range of risky assets.

Today, you should pay attention to the release of data on the US economy: the Index of manufacturing activity from the Federal Reserve Bank of Chicago, statistics on orders for durable goods, as well as an updated estimate of GDP for the III quarter.

Recall that Thanksgiving day is celebrated in the USA tomorrow, in connection with which the American sites will be closed, and trading activity at the end of the week may significantly decrease. Today, the EUR/USD pair will be trading nearby the level of 1.10.

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GBP/USD. November 28, 2019 – Pound rises on Brexit positive news

Yesterday, the pound got support and managed to rise to the level of 1.2950. The growth driver was the result of a public opinion poll according to which the Conservative Party, which includes the current British Prime Minister Boris Johnson, can count for a majority of votes in parliament on December elections. As a result, this may increase the likelihood of «soft» Brexit (with a deal) before the deadline set for January 31.

On the other hand, in the debt market we see a decrease in the yield spread of 10-year UK/US government bonds, which signals a possible fall of the British currency.

Today the United States celebrate Thanksgiving day, so the market activity will not be high. During the day, the pair will fluctuate in the range of 1.2900-12950.

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EUR/USD. November 29, 2019 – The pair stabilized at 1.10

The appetite for risky assets remains moderate amid another complication in relations between the US and China. On the eve it became known that D. Trump nethertheless signed a bill supporting protesters in Hong Kong. 

Important macroeconomic news is not expected today, so the pair EUR/USD will continue to fluctuate in the area of 1.1000. Yesterday's inflation data in Germany did not have a visible impact on the euro, despite the fact that the consumer price index was slightly better than expected (1.2% y/y against the expected 1.1% y/y). In the daytime you should pay attention to the release of data on inflation in the European Union.

Yesterday American exchanges were closed due to Thanksgiving celebration, and today the US sites will close earlier than usual, so trading activity in the evening hours is likely to remain low.